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Edgar Hicks    


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...Even Frost is Bearish



With this morning's USDA release of expectations for next year's corn carryout at 2 billion bushels, Dec. corn has broken below $3.40 into a new contract low.  (Today, even the dollar index has made a 14 month high which adds to the drag on exports).


With expectations of a 14 billion+ corn crop, those ethanol merchants that invested returns into corn storage will see above average returns as post-harvest basis snaps in.  There are also 30 cent premiums for nearby corn over new crop and "free storage" can be a money maker. However, many Cargill trainees can recall being the recipient of an often used reprimand of the 1970's. "Storage is too valuable; make sure you are not giving away your house with free rent".


Next month's USDA crop production numbers will be the first to include actual field surveys.  Even with talk of a 175 corn yield...today it seems hard to expect a bearish market price response?




 The CFO Systems Corn Crush


The CFO Systems Corn Crush  is now $1.02 /gallon of ethanol on September 11, 2014.
*Using nearby CBOT corn futures, CBOT ethanol futures, USDA corn oil prices and ethanol industry conversion standards.



We believe positions are unique to each person's risk bearing ability, marketing strategy and crop conditions, therefore we give no blanket recommendations. The risk of loss in trading commodities can be substantial, therefore carefully consider whether such trading is suitable for you in light of your financial condition.